Loan
Agreement
Dated as
of August ___, 2009
|
|
Hotel
Outsource Management International, Inc., a Delaware corporation whose address for the
purposes of notices sent under this Agreement shall be One
Embarcadero Center, Suite 500, San Francisco CA 94111, Fax:
+1-415-433 5994, e-mail: jackronnel@my-homi.com ; with a
copy to Reif & Reif Law Offices, 17-4 Yitzchak Rabin Rd., Bet
Shemesh 99585, Israel, Fax: +972-2-999-7993, e-mail:
Mail@ReifLaw.com (the “ Borrower ”)
;
|
|
|
Avraham
Bahry , of 1 Gan
HaShikmim Street, Ganei-Yehuda - Savyon 56905, Israel (the “
Lender ”);
|
|
|
Borrower
requires immediate funds, which, in the current economic climate,
it has not been able to obtain in a timely manner from banking
institutions, as interim financing until receipt of the proceeds
which it anticipates receiving from the rights offering pursuant to
the S-1 Registration Statement which was declared effective by SEC
as of June 25, 2009 (the “ Rights Offering ”);
and
|
|
|
Borrower has
requested that Lender, who holds office as Chairman of Borrower,
assist Borrower by agreeing to loan such funds to Borrower in the
amount and under the terms set forth in this Agreement below;
and
|
|
|
Lender is
willing to make a loan to Borrower, all subject to and in
accordance with the terms of this Agreement;
|
Therefore, the parties
have made condition and agreed as follows:
|
|
Upon the terms
and conditions set forth in this Agreement, Lender agrees to loan
to Borrower the principal amount of $100,000.- (one hundred
thousand US Dollars) (the “ Loan ”).
|
|
|
The Loan will
be made available to Borrower within 3 business days of the date
hereof (hereinafter: the “ Loan Date ”), by
means of one or more bank transfers in New Israeli Shekels
according to the Dollar/Shekel Representative Rate of Exchange last
published prior to the transfer directions being given by Lender,
to the account of Borrower’s subsidiary, HOMI Israel Ltd,
account No. 640600/48 at Bank Leumi, branch No. 809 in Tel-Aviv,
Israel.
|
|
|
Borrower shall
pay interest on the entire outstanding balance of the Loan,
commencing as of the Loan Date, at the rate of 6% per annum (the
“ Interest ”).
|
|
|
On the
Repayment Date (as defined below), Borrower shall pay to Lender all
of the Interest that has accrued and is outstanding on the Loan up
until that date.
|
|
|
In accordance
with and subject to the provisions of this Section 3 below,
Borrower shall repay the entire Loan, with all accrued Interest, in
a single, cash payment to Lender, no later than the 4 month
anniversary of the Loan Date (the “ Repayment Date
”).
|
|
|
Notwithstanding
the foregoing, it is hereby agreed that if the Rights Offering is
subscribed for in full (including any over-subscription by
subscribing shareholders), yielding gross proceeds of $800,000 for
Borrower, then if, after exercise of Lender’s rights in the
Rights Offering and conversion of loans into shares in that
context, there shall still remain an outstanding balance of Loan
and accrued Interest under this Agreement and under the Loan
Agreement between Borrower and Lender, dated May 12, 2009 (for the
loan of $200,000), then Borrower undertakes to repay all of said
outstanding balance by means of cash payment to Lender, and not by
issue of shares, said payment to be made within 5 business days of
Borrower receiving the gross proceeds from the Rights
Offering.
|
Loan
Agreement: HOMI - Bahry
|
|
Except in the circumstances set forth in Section
3.2 above , and notwithstanding Lender’s declaration
that, as at the date hereof, he would prefer for the Loan to be
repaid in cash, Lender nevertheless agrees that Borrower may elect
to effect repayment of any part, or all, of the Loan and/or accrued
Interest, to Lender, no later than the Repayment Date, by means of
the issue to Lender of shares of Borrower’s common stock. The
purchase price of each share so issued shall be deemed to be the
same price per share as in the Rights Offering (the “
Price Per Share ”), such that the outstanding balance
of the Loan plus accrued Interest shall be reduced, at the time of
issue of such shares, by the quantity of shares so issued
multiplied by the Price Per Share. If, for example, the Price Per
Share is $0.04 and if the Repayment Date falls exactly on the 4
month anniversary of the Loan Date, and the outstanding balance of
the Loan plus the accrued Interest is $102,000, then the issue, on
that date, of 2,550,000 shares of Borrower’s common stock, to
Lender’s order, as set forth herein, would constitute full
repayment of the Loan and all accrued Interest.
|
For any sums
that may be payable by Lender in the Rights Offering, in respect of
shares which Lender may subscribe for in such Rights Offering, up
to the total amount then owed by Borrower to Lender under this
Agreement, Lender, or Borrower, may elect, by written notice to the
other, that such sums be offset against the outstanding balance of
the Loan and accrued Interest then owed to Lender.
|
|
If Borrower
elects to repay any part of the Loan and/or accrued Interest by
means of the issue of shares as set forth in Section 3.3 above,
then the shares must be duly issued in Lender’s name, or to
his order, and registered in Lender’s name, or to his order,
in Borrower’s share register, and duly executed share
certificates must be delivered to Lender, or to his order, all no
later than the Repayment Date.
|
|
|
For avoidance
of any doubt, Borrower undertakes to fully repay the Loan and all
accrued Interest, no later than the Repayment Date, either by means
of a cash payment as set forth in Sections 3.1 and 3.2 above, or by
means of a share issue, as set forth in Sections 3.3 and 3.4 above,
or by means of a combination of such cash payment and such share
issue as set forth herein.
|
|
|
Without
derogating from any statutory remedies and/or other remedies
available under the terms of this Agreement, if Borrower is in
default under this Agreement and does not fully repay the Loan and
accrued Interest in the manner set forth above, no later than the
Repayment Date, then Lender shall be entitled to elect, by means of
written notice to Borrower, whether repayment of the outstanding
balance of the Loan and accrued Interest must be made by means of
cash payment, or by means of share issue under the principles
outlined above, or by a combination of these methods, and Borrower
undertakes to comply with such election by Lender.
|
Without
derogating from any statutory remedies and/or other remedies
available under the terms of this Agreement, any sums not paid by
Borrower at the appointed time under this Agreement shall
be subject to interest at the highest rate of interest
then charged by Bank Leumi of Israel in respect of Dollar sums
overdrawn beyond an agreed credit facility, such interest to accrue
from the date payment was originally due until the date of actual
payment; this interest rate shall initially be determined on the
date payment was originally due, and thereafter monthly until the
date of actual payment. Nothing in this Section 4 may be
|
